Don’t Get Caught Out By HMRC Interest Charges

If you run a restaurant, café or takeaway, staying on top of your tax payments is vital – miss a deadline, and HMRC will start charging interest on what you owe.


From 6 April 2025, those interest rates have gone up – making late payments even more costly.


What happens if you pay your taxes late?


HMRC charges interest from the original due date until the day they receive payment. So the longer the delay, the more you’ll pay.

From April 2025, the interest rate on late payments rose to 8.5% per annum – in line with inflation and the Bank of England base rate. That’s the base rate plus 4%.


If you overpay or pay too early, HMRC will pay you interest too – although at a lower rate. From 25 February 2025, this dropped from 3.75% to 3.50%.


What if you can’t afford to pay on time?


If cash flow is tight – which is often the case in hospitality – you may be able to arrange a ‘Time to Pay’ agreement with HMRC. This allows you to spread payments and keeps interest charges relatively low.


However, ignoring the problem and missing payments without an agreement in place can lead to penalties on top of interest.


How we can support you


We work with restaurant and café owners every day, so we understand the pressures you face. Whether it’s Corporation Tax, PAYE or VAT, we’ll:

  • Give you clear deadlines and help you prepare in good time

  • Run forecasts so you’re not caught short

  • Help you understand what you owe and when

  • Liaise directly with HMRC if you need a payment plan


Already a client? You’re covered – we’ll make sure you’re always one step ahead. New to MSF? No problem – we can step in and help right away.

Restaurants, cafes, and takeaways can benefit greatly from working with a specialist accountant. If you hadn’t noticed already, we are specialist accountants in Leeds for food service businesses, so unlike most accountants, we have years of experience working with businesses just like you. If you're interested in finding out more about how we can help your restaurant become more profitable,  book a call with one of our accounting experts.